Hevesi's Budget Calculations Greater Than Pataki's

Comptroller Alan Hevesi sized up the new state budget and placed it at $114.7 billion, $1.3 billion more than Gov. George Pataki’s assessment a few weeks ago.

In a report today, Hevesi saidÂ the Legislature’s “final action” on the state budgetÂ addedÂ $2.2 billion from the time of the Legislatureâ€™s agreement and passage of budget bills in April.

That pushedÂ projected spending to as much as $114.7 billion, or about $10.1 billion more than 2005-06 spending.
Pataki’s office is still working on a finacial plan and didn’t have an immediate response.

Hevesi’s numbers suggest budget growth ofÂ 10 percent from last yearÂ – more than three times the rate of inflation.

He also found:

Spending growing faster than revenues. Both General Fund and All Funds spending is projected to grow twice as fast as revenues between 2005-06 and 2008-09. For example, General Funds spending is expected to increase nearly 30 percent, while revenues grow by 15 percent.

Surplus used for operational spending.Â Best practices dictate that a one-time revenue, such as a surplus, should be used for one-time spending. However, barring significant increases in receipts through the 2006-07 fiscal year, nearly the entire $2 billion surplus from 2005-06 will be used for 2006-07 recurring spending.

Budget gap grew higher.Â After the Legislature acted on the budget, the Division of Budget calculated a two-year General Fund budget gap of $9.8 billion, while the Comptrollerâ€™s office identified an additional $3 billion in risks that could raise that gap to as much as $12.8 billion. Accounting for recent legislative actions, the two-year gap is likely to rise to as high as $13.9 billion.

Debt continues to increase.Â The Supplemental Budget added $1.8 billion in new debt, bringing the total amount of new debt authorized in 2006-07 to $16.5 billion.Â The State is directly responsible for $11.8 billion of this amount. With this additional $1.8 billion, outstanding debt could increase to nearly $65 billion, or 33.9 percent, by 2010-11.